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Ice circles occur at bends in the river where the accelerating water creates a force called 'rotational shear', which breaks off a chunk of ice and twists it around. As the disc rotates, it grinds against surrounding ice — smoothing into a perfect circle.
Another kind of ice circle are actually ice pans, or surface slabs of ice that form in the center of a lake or creek, instead of along the water's edge. They can be explained by quick shifts in temperature. As water cools, it releases heat that turns the water into frazil ice — a collection of loose, needle-shaped ice particles that can cluster together in an ice pan. If a lake accumulates enough frazil ice and the current is slow, over time, the pan can become a hanging dam: a dense, heavy piece of ice with high ridges and a low centre.